New Media Investment To Buy Gannett

(RTTNews) - New Media Investment Group Inc. (NEWM) Monday said it has agreed to acquired Gannett Co. Inc. (GCI).

Under the terms of the deal, shareholders of Gannett will receive $6.25 in cash and 0.5427 of a New Media share for each Gannett share they hold, representing total consideration of $12.06 per Gannett share. This represents a premium of about 18% to the five-day volume-weighted average price of Gannett shares as of that date.

After the close of the transaction, Gannett shareholders will hold approximately 49.5% of the combined company and New Media shareholders will hold approximately 50.5%.

The deal brings together the portfolios of two leading local newspaper companies, and includes USA TODAY, Gannett's flagship brand, and its more than 160 brands in the U.K.

The deal also affords an opportunity to realize run-rate cost synergies of $275 - $300 million annually across the combined company.

"We believe this transaction will create value for our shareholders, greater opportunities for our employees, and a stronger future for journalism. Gannett is an innovative, digitally-focused media and marketing solutions company with well-known brands worldwide. Uniting our talented employees and complementary portfolios will enable us to expand our comprehensive, hyperlocal coverage for consumers, deepen our product offering for local businesses, and accelerate our shift from print-centric to dynamic multimedia operations. We are honored to become a part of Gannett's storied history and a steward of their strong media properties into the future. We are committed to delivering significant synergies in a thoughtful manner, consistent with our shared goals for the business," said Michael Reed, New Media Chairman and Chief Executive Officer.